Category: money

Without Kings

Published May 1, 2012 by cgerrish

Spending two weeks in Paris, I was immersed in the past. Architecture of bygone times poking through from a dozen historical eras as I walked the streets. There’s a kind of sublimity that’s the experience of being overpowered by the object of contemplation. The size, scale and beauty of the cathedrals and chateaus take the breath away.

I was never so conscious of being born and raised in a country that never had Kings, a country that was never dominated by the Church. These monuments left by Kings and Cardinals just aren’t the kind of things that could exist in my country. We’ve had our industrialists and captains of industry, but the power of capital simply isn’t at the same level.

Stewart Brand wrote a book about how buildings learn; even these monuments created to glorify royalty or the institution of the church have adapted to the new environment of the Republic. We preserve the sublime without regard to its origin. We experience its beauty and turn a deaf ear to the raw power responsible for its being.

Comments closed

Shop Windows And Tablets: Through The Looking Glass

Published October 3, 2011 by cgerrish

In looking for lost house keys under the light of the street lamp, we put aside the fact that we lost them in the ditch at the other side of the road. It’s odd how we can move so swiftly in a particular direction without really knowing where we’re going. An incredible amount of ingenuity, resources and coordination has been applied to building tablet computers. There’s an unstated assumption that the post-pc era is defined by an evolution of the computer to a new human-computer interface model with a new form factor. And at a technical level, there’s some truth there; however at the level of the market for devices, there’s not enough truth.

To make sense of all this, let’s go back to a 1996 interview by Gary Wolf with Steve Jobs. Jobs was at NeXt and was gazing ahead at the future:

Wolf: What other opportunities are out there?

Jobs: Who do you think will be the main beneficiary of the Web? Who wins the most?

Wolf: People who have something –

Jobs: To sell!

Wolf: To share.

Jobs: To sell!

Wolf: You mean publishing?

Jobs: It’s more than publishing. It’s commerce. People are going to stop going to a lot of stores. And they’re going to buy stuff over the Web!

e-Commerce’s path to the Network was from the paper catalog to the electronic catalog. The Sears Catalog was one of the early prototypes for distance retailing. But what was the paper catalog? Why was it successful? The catalog was an evolution of the shop window in the arcade. And it was the shop window that enabled the romantic imagination of the consumer. Heather Marcelle Crickenberger talks about Walter Benjamin’s idea of the flâneur:

“Flâneur” is a word understood intuitively by the French to mean “stroller, idler, walker.” He has been portrayed in the past as a well-dressed man, strolling leisurely through the Parisian arcades of the nineteenth century–a shopper with no intention to buy, an intellectual parasite of the arcade. Traditionally the traits that mark the flâneur are wealth, education, and idleness. He strolls to pass the time that his wealth affords him, treating the people who pass and the objects he sees as texts for his own pleasure. An anonymous face in the multitude, the flâneur is free to probe his surroundings for clues and hints that may go unnoticed by the others.

Today we call it window shopping. It’s an exercise of the imagination in the role of the consumer. What might I look like in that outfit, listening to that music, with those kitchen appliances? A large plate of glass opened a window on to the possibilities contained within the shop. The flâneur could stroll the arcade moving from this window to that, searching for something that might catch his fancy.

Timothy Morton discusses this performance of the consumer imagination in his essay on “The Beautiful Soul.”

These performative styles are outlined by myself (Morton) and Colin Campbell. One style stands out, and that is a kind of meta-style that Campbell calls bohemianism and I call Romantic consumerism. This kind of consumerism is at one remove from regular consumerism. It is “consumerism-ism” as it were, that has realized that the true object of desire is desire as such. In brief, Romantic consumerism is window- shopping, which is hugely enabled by plate glass, or as we now do, browsing on the internet, not consuming anything but wondering what we would be like if we did. Now in the Romantic period this kind of reflexive consumerism was limited to a few avant-garde types: the Romantics themselves. To this extent Wordsworth and De Quincey are only superficially different. Wordsworth figured out that he could stroll forever in the mountains; De Quincey figured out that you didn’t need mountains, if you could consume a drug that gave you the feeling of strolling in the mountains (sublime contemplative calm, and so on). Nowadays we are all De Quinceys, all flaneurs in the shopping mall of life. This performative role, this attitude, is all the more pervasive, leading me to believe that we haven’t really exited from the Romantic period—another sense in which “prehistory” isn’t quite right for what I’m describing, but extremely right in another sense, namely that we’re still caught in an attitude that we don’t fully understand or become aware of.

When we talk about what’s assumed to be a tablet computer, we’re actually talking about a plate of glass, a shop window. In a discussion with Nick Bilton of the New York Times about why all these tablets look similar, Ryan Block hit on the key, although he may not have realized it:

“We are talking about a screen, where the screen is the entire experience and it can only really look and act one way, and that is to look similar to the iPad,” Mr. Block explained in a phone interview Thursday. “At the end of the day, they are all going to look similar, because a tablet is just a piece of glass.”

The innovations of the post-pc era aren’t to the computing device, they’re to the shop window. The ability to transact as part of the performance and the transformation of the goods from material to digital such that they can be played within the same window are the key additions to the “piece of glass.”

If you view the recent crop of tablet computers through this lens, you’ll see what separates the Apple and Amazon products from the rest. We pass the empty shop window of the deserted store as we move on down the block to see what we might find next. Of course, it’s simple to see how a technologist might confuse a shop window with a flat computing device.

One Comment

Jubilee: Systems of Forgiveness

Published September 19, 2011 by cgerrish

The technical systems we build have perfect memories. They keep account of everything. The ones are the ones, and the zeros are the zeros. We network the systems together and even account for things across multiple domains. While on the one hand we talk about economies of abundance and prices of many things converging on free—we know the score.

When Jacques Derrida talks about forgiveness, he cuts to the chase. To forgive is to forgive what is unforgivable. It’s an act of transformation, and by definition impossible. Forgiveness without cost isn’t forgiveness. Forgiveness costs everything. A forgiveness that translates the debt from one domain to another isn’t forgiveness. To forgive is to break all the rules of the system.

David Graeber, in discussing his work “5,000 Years of Debt” talks about how morality and monetary debt have always been intertwined.

In Sanskrit, Hebrew, Aramaic, ‘debt,’ ‘guilt,’ and ‘sin’ are actually the same word. Much of the language of the great religious movements – reckoning, redemption, karmic accounting and the like – are drawn from the language of ancient finance. But that language is always found wanting and inadequate and twisted around into something completely different. It’s as if the great prophets and religious teachers had no choice but to start with that kind of language because it’s the language that existed at the time, but they only adopted it so as to turn it into its opposite: as a way of saying debts are not sacred, but forgiveness of debt, or the ability to wipe out debt, or to realize that debts aren’t real – these are the acts that are truly sacred.

We’ve become very sophisticated in creating instruments of debt and even derivatives on those instruments. Our systems of forgiveness, however, have been left behind. Debt and forgiveness of debt historically were linked. Forgiveness allows a system reset, the negative numbers are zeroed out. The moral judgement that comes along with monetary debt is wiped away. What by definition shouldn’t be forgiven is forgiven.

As the economies of the world are gripped by a debt crisis, the call for austerity measures come down from on high. From within the system, there’s only one kind of solution that’s rational. Austerity is the proper solution on both an economic and a moral level. Only moral weakness and foolishness would cause a person or a country to borrow more than they could repay. A good dose of austerity will put them back on the straight and narrow.

Of course, as Graeber points out, there’s a certain rationality for breaking the rules of the system at particular moments in time:

The first markets form on the fringes of these complexes and appear to operate largely on credit, using the temples’ units of account. But this gave the merchants and temple administrators and other well-off types the opportunity to make consumer loans to farmers, and then, if say the harvest was bad, everybody would start falling into debt-traps.

This was the great social evil of antiquity – families would have to start pawning off their flocks, fields and before long, their wives and children would be taken off into debt peonage. Often people would start abandoning the cities entirely, joining semi-nomadic bands, threatening to come back in force and overturn the existing order entirely. Rulers would regularly conclude the only way to prevent complete social breakdown was to declare a clean slate or ‘washing of the tablets,’ they’d cancel all consumer debt and just start over. In fact, the first recorded word for ‘freedom’ in any human language is the Sumerian amargi, a word for debt-freedom, and by extension freedom more generally, which literally means ‘return to mother,’ since when they declared a clean slate, all the debt peons would get to go home.

As our societies become more rational, secular and technical we become less able to do the impossible, to forgive what is unforgivable. It just doesn’t make sense, it’s not a part of the algorithm. Something like a Jubilee seems like the superstition of a primitive people. In the systems that we’re building, is there a set of events that will cause the system to reset itself? Or do we think we’ve somehow evolved into a system of systems that never needs to be rebooted?

Well shake it up now Sugaree, I’ll meet you at the jubilee
And if that jubilee don’t come maybe I’ll meet you on the run
Just one thing I ask of you, just one thing for me
Please forget you know my name, my darling Sugaree

Comments closed

A Change In The Weather: Buddhist Economics

Published September 5, 2011 by cgerrish

In taking note of a shift in tone, we must immediately acknowledge that it will not be the new, new thing. It’s not the hint, the vague scent, that turns out to be the key to the next Network-scale technological advance. It’s not the thing everybody must have; it’s not the ticket that wins the lottery for its owner. Nor is it the hit song that will be playing in the background of everyone’s thoughts as the Summer ends and Autumn opens before us.

The pattern is larger than this, but there were two moments that signaled a change. One of these moments was Catarina Fake’s blog post “Make Things.” In this post she describes a more humble approach to making tools for people. Her thoughts are set in the background of an overheated venture capital environment where liquidity events are plotted prior to thinking about useful products. Deployment of, and return on, capital seems to have superseded the passion to build, explore and make things. Companies become just another fungible asset class, a tool for capital’s replication and growth. Fake asks the potential entrepreneur to take a step back and ask whether capital is subordinate to, and serving a passion (as a means) or whether the passion to make things has been securitized and sold to the highest bidder (as an end).

For Fake, capital isn’t the wellspring of inspiration, instead it’s the creativity of people making things:

…I have been inspired in my work by stuff that people make. I fell in love with zines and independent radio when I was an isolated teenager living in the suburbs. Then BBSs, people’s personal web sites, Usenet, Entropy8, online zines (holy crap, the old Bitch magazine site is now a porn portal! And Maxi is squatted!), blogs, Excel, online communities, Amazon, Salon, eBay, O’Reilly books, Google, Friendster, Alamut, NQPAOFU, Metafilter, board games, Blogger, paper games, 1000 blank cards, The Mirror Project, 1000 journals, Moveable Type, 20 things, Google Maps, Flickr, Gmail, last.fm, iPhone, NaNoWriMo, McSweeney’s, Kingdom of Loathing, muxtape, vimeo, Etsy, iPad, Kickstarter …the people who make these things are my leaders.

Putting ‘cool’ before ‘capital’ is certainly a commendable reordering of priorities, but somehow it doesn’t go far enough. On one end of the spectrum, passion must fend off the temptations of subordinating itself to capital; on the other end, it faces a kind of commoditization that has forced pricing expectations toward zero.

This leads us to the second moment in this shift in tone. Jaron Lanier recently published an interview and essay called, “The Local-Global Flip.” In it he examines the Network as a local and global economic platform. When we think about making tools for people, just what kind of tools are we thinking of?

Everyone’s into Internet things, and yet we have this huge global economic trouble. If you had talked to anyone involved in it twenty years ago, everyone would have said that the ability for people to inexpensively have access to a tremendous global computation and networking facility ought to create wealth. This ought to create well being; this ought to create this incredible expansion in just people living decently, and in personal liberty. And indeed, some of that’s happened. Yet if you look at the big picture, it obviously isn’t happening enough, if it’s happening at all.

Dominance at Network scale allows the major players to generate mountains of cash by charging a small vig on every transaction and transfer of data. Not just the long tail, it’s the whole hog. It’s a big data model that requires volume and an unlimited scaling infrastructure. The promise of cloud computing is that if you actually won the lottery, your infrastructure could scale up to handle it. The reality is there’s not much room at the total-Network-dominance table. The corporations flirting with the cloud have a lot in common with McSweeny’s writer, Pat Stansik’s friend who just upgraded to a Vimeo Plus account.

Hey, I know we haven’t talked in a while but I just wanted to let you know that I upgraded to a Vimeo Plus account. It costs $59.95 a year, which might sound expensive, but after doing some research I decided that it’s a good investment. You’re probably wondering why I would spend money on something I can already do for free but trust me; this is going to be a big step in my filmmaking career.

Economist, Tyler Cowen, in his book “The Great Stagnation” notes that these Network-scale technology businesses don’t actually employ many people. Their success is picking low-hanging fruit and doesn’t translate into success for our society or our country. And Lanier observes that while the Network promises efficiency, freedom and empowerment, if you look closely you see that it isn’t actually designed to deliver on that promise.

…I’ll often get a lot of pushback and they’ll say, “No, no, no. There are all these people who are being empowered by all this stuff on the Internet that’s free”, and I’ll say, “Well, show me. Where’s all the wealth? Where’s the new middle class of people who are doing this?” They don’t exist. They just aren’t there. We’re losing the middle class, and we should be saving it. We should be strengthening it.

If we used to be a bell curve society, we’re ending up as a U-shaped society, turning into what Brazil used to be, or something like that, that’s where America is going. You can see the Apple model, and it’s not just Apple, but this notion of the elite-controlled thing serving the upper horn of the U, and you can see the Google model, which is like the seedy pawn shop and cash store kind of approach to the Internet where, “Oh, we’ll give you coupons, and we’ll sell advertising to you, and it’s free, free, free, free, free.” That attaches itself to the lower horn of the U.

The Network has the potential to make the local into the global, and it’s in this possibility that Lanier puts his finger on one of the key issues of our time. When the local player becomes global, but still plays by the rules of locality, an unsustainable economy is created.

The network effects can be so powerful that you cease being a local player. An example of this is Wal-Mart removing so many jobs from their own customers that they start to lose profitability, and suddenly upscale players, like Target, are doing better. Wal-Mart impoverished its own customer base. Google is facing exactly the same issue long-term, although not yet. The finance industry kept on thinking they could eject waste out into the general system, but they became the system. You become global instead of local so that the system breaks. Insurance companies in America, by trying to only insure people who didn’t need insurance, ejected risk into the general system away from themselves, but they became so big that they were no longer local players, and there wasn’t some giant vastness to absorb this risk that they’d ejected, and so therefore the system breaks. You see this again and again and again. It’s not sustainable.

And so we spin back around to Catarina Fake’s post about a humble approach to building tools for people. Are the tools we’re adding to the Network ones that allow adults to make a living, or do they just promise more non-negotiable social reputation points. The economics of these tools need to work for more than the rich or teenagers living under their parent’s roofs. Again, here’s Lanier:

There is this huge increase in efficiency, but the interesting thing is that increasing efficiency by itself doesn’t employ people. There is a difference between saving and making money when you’re unemployed. Once you’re already rich, saving money and making money is the same thing, but for people who are on the bottom or even in the middle classes, saving money doesn’t help you if you don’t have the money to save in the first place.

The choice isn’t necessarily a simple one between capital and passion, it may be necessary to put our concept of economics on completely different footing. E.F. Schumacher’s Buddhist Economics provides a framework for rethinking and de-centering our preconceptions about economics. What if we were to “make things,” create useful tools that were meaningful in the framework of Buddhist economics? How would those tools look different from the ones we make today? Here’s Schumacher:

Economists themselves, like most specialists, normally suffer from a kind of metaphysical blindness, assuming that theirs is a science of absolute and invariable truths, without any presuppositions. Some go as far as to claim that economic laws are as free from “metaphysics” or “values” as the law of gravitation. We need not, however, get involved in arguments of methodology. Instead, let us take some fundamentals and see what they look like when viewed by a modern economist and a Buddhist economist.

It is clear, therefore, that Buddhist economics must be very different from the economics of modern materialism, since the Buddhist sees the essence of civilization not in a multiplication of wants but in the purification of human character. Character, at the same time, is formed primarily by a man’s work. And work, properly conducted in conditions of human dignity and freedom, blesses those who do it and equally their products.

Modern economics, on the other hand, considers consumption to be the sole end and purpose of all economic activity, taking the factors of production—and, labour, and capital—as the means. The former, in short, tries to maximise human satisfactions by the optimal pattern of consumption, while the latter tries to maximise consumption by the optimal pattern of productive effort. It is easy to see that the effort needed to sustain a way of life which seeks to attain the optimal pattern of consumption is likely to be much smaller than the effort needed to sustain a drive for maximum consumption. We need not be surprised, therefore, that the pressure and strain of living is very much less in say, Burma, than it is in the United States, in spite of the fact that the amount of labour-saving machinery used in the former country is only a minute fraction of the amount used in the latter.

It’s a shift in the tone of the normal flow of the conversation. Things that solidly had one well-known meaning suddenly have an unsettling ambiguity. Now we ask not what we can do for the Network, but rather what the Network can do for us. For a brief moment, a slight crack is visible in the veneer of Network of bread and circuses. And no, it’s not the new new thing. It’s something else entirely. It starts by asking about who the economics of “free” really benefits.

Comments closed